Abstract: All three of the traditionally recognized new institutionalisms – rational choice, historical, and sociological – have increasingly sought to ‘endogenize’ change, which has often meant a turn to ideas and discourse. This article shows that the approaches of scholars coming out of each of these three institutionalist traditions who take ideas and discourse seriously can best be classified as part of a fourth ‘new institutionalism’ – discursive institutionalism (DI) – which is concerned with both the substantive content of ideas and the interactive processes of discourse in institutional context. It argues that this newest of the ‘new institutionalisms’ has the greatest potential for providing insights into the dynamics of institutional change by explaining the actual preferences, strategies, and normative orientations of actors. The article identifies the wide range of approaches that fit this analytic framework, illustrating the ways in which scholars of DI have gone beyond the limits of the traditional institutionalisms on questions of interests and uncertainty, critical junctures and incremental change, norms and culture. It defines institutions dynamically – in contrast to the older neo-institutionalisms’ more static external rule-following structures of incentives, path-dependencies, and cultural framing – as structures and constructs of meaning internal to agents whose ‘background ideational abilities’ enable them to create (and maintain) institutions while their ‘foreground discursive abilities’ enable them to communicate critically about them, to change (or maintain) them. But the article also points to areas for improvement in DI, including the theoretical analysis of processes of ideational change, the use of the older neo-institutionalisms for background information, and the incorporation of the power of interests and position into accounts of the power of ideas and discourse.

On November 1, 2017, I gave a talk at the Center for German and European Studies entitled “What leadership for Germany in the EU, faced with rising populism and euro-fatigue?”

The talk centered around the following questions: What leadership will Germany bring to the EU in coming years, given a weakened Chancellor, a potentially fractious government coalition, and a rising populist opposition in the Bundestag for the first time? How will Merkel respond to the new French leader’s ideas about deepening integration, in particular on the Eurozone? How will she deal with the on-going refugee crisis, and the growing divisions between East and Western Europe? How Merkel deals with these challenges may very well determine the future of Europe in the near term.

My thoughts on how the challenges facing the EU from populism, and how progressives can fight back, in particular by rethinking how to do with governance of the Euro and how to re-envision the EU:

In recent years, the European Union has suffered through a cascading set of crises, including the Eurozone crisis, the refugee crisis, the security crisis, and Brexit. But rather than bringing the EU together, with concerted responses that would demonstrate its common values on its 60th anniversary, these crises have revealed cross cutting divisions among member states. What’s more, they have been accompanied by major crises of politics and democracy for the EU as well as its member states.

At EU level, questions are increasingly raised not only about the (lack of) effectiveness in solving the various crises but also democratic legitimacy. The causes are EU governance processes characterized by the predominance of closed-door political bargains by leaders in the Council and by a preponderance of technocratic decisions by EU officials in the Commission and the European Central Bank, without significant oversight by the European Parliament. At national level, concerns focus on the ways in which the EU’s very existence has diminished elected governments’ authority and control over growing numbers of policies for which they had traditionally been alone responsible, often making it difficult for them to fulfill their electoral promises or respond to their voters’ concerns and expectations.

Marine Le Pen, French co-chair of the ENF group – Photo by European Parliament

On Friday, March 31, I was quoted in another Washington Post article on the upcoming French elections. Making the case that the anti-European sentiment in France closely mirrors that of the Brexit and Donald Trump phenomena in Britain and the United States, I pointed out that it’s the same discourse of globalization gone too far, of outrage over high unemployment — and especially youth unemployment. As the authors of the article point out, “the general unemployment rate in France has hovered around 10 percent for years, and the youth unemployment rate is about 26 percent.” But the phenomenon is also sociocultural. People really feel a loss of control, political and otherwise. Le Pen gives people a nostalgia for a vanished past, a past most people don’t even remember.

The Washington Post asked experts on French politics for their observations on the upcoming elections and their “guesstimates” of the first-round winner and final result. My comments appeared in yesterday’s issue as part of a feature entitled “The Guesstimator: Predict the French presidential election and win a free Post subscription!” Here’s what I had to say:

First-round winner: Le Pen, 32 percent; final results: Macron 57 percent, Le Pen 43 percent. “Le Pen’s base is no more than 40 to 45 percent,” while Fillon and Macron are competing for a realigning electorate. Hurting Le Pen further is that the French are “appalled” by Trump. Finally, Schmidt notes, the “fake jobs” scandals facing Fillon and Le Pen will help Macron. If Fillon does survive the first round, Schmidt predicts Le Pen will pick up some votes from the left due to her strong defense of welfare and her anti-globalization stance.

At the start of March, the European Commission published a white paper ‘On the Future of Europe’. Vivien Schmidt and Matt Wood assess the Commission’s proposals, arguing that while the paper’s focus on differentiated integration is pragmatically useful under the current circumstances, this strategy could exacerbate distrust in the EU if it is not accompanied by greater accountability and transparency in decision-making.

Now that the UK has voted to leave the EU, all the attention has been focused on how it will go about leaving, or even whether it will leave in the end. But equally important is how the EU responds to Brexit: whether as an isolated case to be quarantined in order to avoid contagion to other member-states, or as the symptom of a wider disease. Only by seeing the Brexit vote as a wake-up call to reinvent the EU may the EU itself actually overcome the many challenges it faces. What the EU must do is to generate a ‘new deal’ for the EU as a whole, not to treat the UK in isolation.

The EU will probably treat the UK as exceptional, as the result of populist Euroskepticism gone mad in a country ill-served by a conservative party trying to solve its internal divisions via referendum, drip-fed anti-EU rhetoric by the tabloids, where the EU has been the scapegoat for the UK’s many home-grown problems. The EU is therefore likely to hunker down, to protect all the acquis so valiantly fought for over the years—including the freedom of movement of EU citizens that has been a major focus of the Leave campaign.

But however tempting it may be for the EU to treat the UK as an example—so that no other member-state follows suit—it would be a mistake. The EU would do better to listen to and address the concerns of British citizens, in particular because calls for referenda are now echoed in other EU member-states by the likes of Marine Le Pen and Geert Wilders, among others.

As the referendum campaign nears its end, one central issue is remarkable for its absence, despite the fact that it has been a major contributor to the anger that lends support to the Brexit camp: neo-liberalism. The revolt against the political parties, the rejection of the experts, the distrust of the elites more generally—all of this has to do with neo-liberalism—as does the venting by working and middle class people against the worsening of their life chances due to stagnant wages, growing inequality, and the increasing difficulty for the young to get a foot on the real estate ladder, or a steady well-paying job. And yet the real cause of these concerns is never addressed. Instead, the EU and immigration are blamed for all of Britain’s ills. But whether the decision on June 23 is Leave or Remain, neither Britain’s problems nor citizens’ dissatisfaction will go away.

Neo-liberalism has been so resilient in the UK as well as in the EU that it receives barely a mention in the mainstream press or in public debates. It is so pervasive that it is hardly recognized as a major source of the disenchantment that lends support to the Leave campaign. Better to blame the outsiders (i.e., immigrants and Eurocrats) than to recognize that the problem comes from the inside, from the policies of British governments.

Democratically elected British governments beginning in the 1980s sought to transform the UK economy based on a neo-liberal economic philosophy. It touted the market as the solution, the state as the problem; denigrated politicians and civil servants as rent-seekers not to be trusted; believed that financial market players were rational actors who deserved little or at most ‘light touch’ regulation; and promoted a growth model focused on debt-based real estate speculation rather than rising wages, and on service industries in place of manufacturing. It should be no wonder, following the financial crisis of 2008 with the concomitant rise in job insecurity and poverty, in the face of no change in the neo-liberal discourse let alone the policies, that working people would have lost faith in their politicians, and expect some alternative. But, surprisingly, there is no mainstream alternative, just the sirens of the populists blaming immigration and the EU.

Vivien Schmidt was interviewed recently by Hungarian news outlet HVG (World Economy Weekly) on Europe’s refugee fears and populist responses to threat of terrorism on both sides of the Atlantic.The interview was published in two parts on January 4 and on January 6.

The interview appears to have been widely read in Hungary, as the number of comments on both publications suggest. Zsolt Bayer, a co-founder of Fidesz and a friend of Viktor Orbán referenced the interview in one of his recent pieces arguing that it is an emblematic example of a conspiracy between the so called Western professors and the so called journalists which exemplifies the European left’s flawed way of thinking and the international leftist propaganda that tries to convince people that multiculturalism is something good.

Refugees on the Austrian- Slovenian border on November 1. Fotó: Túry Gergely